How to Make Fair Housing Truly Fair

Pay people to integrate America’s most-segregated neighborhoods.

On its 50th anniversary, the Fair Housing Act remains the most spectacularly successful disappointment in civil rights history.

As an anti-discrimination statute, the FHA has triumphed beyond the wildest dreams of its framers. Housing discrimination was routine and ubiquitous in 1968; now, according to the most comprehensive surveys conducted by the U.S. Department of Housing and Urban Development, it affects only a small percentage of home sales and apartment rentals to black Americans, and in home sales has ceased to exist for Latinos.

But as an anti-segregation effort, the FHA has failed miserably. Scholars estimate segregation by the “dissimilarity index,” which measures how many members of one race in a neighborhood or metro area would have to move to achieve complete integration: 1 is complete segregation, and 0 is complete integration. Although dissimilarity indices have decreased in many metro areas (particularly in the Sun Belt), they remain stubbornly high in areas with high black populations, approaching and sometimes surpassing .85 in areas such as Milwaukee; Gary, Indiana; Detroit; New York; Chicago; and Newark, New Jersey.

Whether you’re looking at employment, out-of-wedlock births, earnings, test scores, or just about any other measure, outcomes for black families living in integrated neighborhoods are far better, even controlling for factors like income and wealth. It’s extremely important, then, to understand how and why integration is (and isn’t) happening now.

Searching for housing is complex, difficult, and costly. Few among us have the time and the resources to look at every house or apartment in every potential neighborhood throughout a metropolitan area, so we fall back on heuristics: What’s close? Where do people I know live? People search in the easiest and most convenient places. In the 1990s, HUD started the “Moving to Opportunity” program, which gave mostly black public housing tenants vouchers to move to middle-class and affluent neighborhoods. The idea was to allow them to take advantage of the resources such neighborhoods would provide, like better schools and job opportunities. But researchers found that many tenants moved to poor, predominantly black neighborhoods close to where they lived—not because they really wanted to, but because these were the neighborhoods they knew. These tenants were not unique: All people of whatever background use these heuristics to help guide their choices.

Even small amounts of discrimination can have an effect on integration. Black Americans very reasonably do not want to face discrimination in their housing searches, and they might not be eager to be the first black families in a neighborhood. Even if most whites would welcome them, it doesn’t take many negative interactions to diminish one’s quality of life. Littlewonder, then, that the metropolitan areas doing the best job on integration—among them Riverside, California; San Antonio; and Seattle—are those with a larger number of “black pioneers,” better-educated men and women who travel to new cities in search of new employment. These pioneers have fewer connections to traditional black neighborhoods and are thus more open to majority-white areas.

Does class fuel segregation? Yes, although less than is commonly supposed. In our new book Moving Toward Integration, Richard Sander, Yana Kucheva, and I examined restricted census data and found that while a significant portion of segregation can be explained by housing affordability, an even greater portion of the effect cannot be. Put another way, racial segregation is about race. This should not be too surprising. Some of the places where it is the easiest to build housing, such as Chicago, remain highly segregated, whereas some markets with extremely high housing costs, such as San Diego, have managed to greatly reduce their dissimilarity indices.

What can be done to decrease housing segregation more broadly? My co-authors and I propose a menu of policy choices, but perhaps the most important concept is the mobility grant. The idea is that people would get assistance in buying a home or moving to an apartment when their presence would help integrate the neighborhood. This would hold for blacks who move to a predominantly white neighborhood and for whites who move to a predominantly black neighborhood. These grants carry the explicit goal of integration, unlike “Section 8” vouchers, which do not focus on integration and in any event rely on landlords to accept them (two major reasons why they have had little impact on racial integration).

Mobility grants cannot eliminate all segregation all at once, but they could take a big whack out of hypersegregation in metro areas such as New York, Chicago, Cleveland, and Gary, Indiana, where the dissimilarity index is near or above .80. By giving potential movers a financial incentive to integrate, we hope to overcome the sociological barriers that keep too much of the country segregated.

A $10,000 grant to buy a house or pay for 10 months’ rent might induce people to examine overlooked neighborhoods, particularly if accompanied by appropriate advertising and counseling programs. It would not need to be a massive program but rather something well within the parameters of a normal (i.e., non-Trump) HUD budget. It could be piloted in a midsize metro area to gauge its effects. In the book, we estimate that a program for metropolitan Buffalo, New York, would require 10,400 pro-integrative moves to reduce the dissimilarity index below .60, at a cost of roughly $285 million. The subsidy would decline and ultimately vanish once the dissimilarity index falls below a certain level.

Constitutional issues emerge with these grants because they are race-conscious. But current doctrine does not forbid race-conscious policy; it simply requires that it be “narrowly tailored” to achieve a “compelling governmental interest.” Indeed, this is about as narrowly tailored as possible, for everyone who uses the subsidy increases integration. Since it is open to all, it is, if not “race-neutral,” perhaps “race-global.” Conservatives who hate affirmative action as a “racial entitlement” should find nothing to object to.

Such a program would increase gentrification, if whites take advantage of it. From an integration perspective, however, that is a good thing: We want whites to move into black neighborhoods just as we want the converse. Most major studies find, though, that gentrification displaces far fewer people than is normally thought (mainly because low-income people move frequently regardless of gentrification). My co-authors and I also propose mechanisms for ensuring gentrification does not go too far. As stated above, the subsidy declines as integration increases, so low-income people would not be fully pushed out. Moreover, we advocate establishing an affordable housing trust in neighborhoods affected by gentrification. Cities would use the higher property taxes generated by gentrification to purchase “affordability easements” over existing low-income housing. These easements would be contracts, put into deeds, specifying that the housing must remain affordable to the poor and working class—an instrument common to federally supported housing across the country. Such a tactic would use gentrification to maintain integration, not undermine it.

Shortly before being elected president, Franklin Roosevelt noted that “the country needs and … demands bold, persistent experimentation. It is common sense to take a method and try it: If it fails, admit it frankly and try another. But above all, try something. The millions who are in want will not stand by silently forever while the things to satisfy their needs are within easy reach.” The question of how to fix racial segregation has vanished from policy discussion for decades. It now needs to return, with an explicit commitment to integration itself. Ending hypersegregation is within reach. Reaching that goal will generate truly fair housing in America.